Skip to main content

Overdraft Programs Under Attack; Recap of Reg Burden Hearing

Overdraft Programs Under Attack; Recap of Reg Burden Hearing:
Written by Steve Van Beek NAFCU
As if the CFPB's Inquiry into Overdrafts wasn't enough, there are continued pushes by both consumer groups and lawmakers to drastically change overdraft protection programs.  Oh, and the New York Times stepped in as well to write an op-ed.
Congress.  This seems like the Credit CARD Act all over again.  Remember how the Federal Reserve was working on amending and changing the credit card disclosures and rules but Congress forced the Credit CARD Act through anyway?  You know, the Credit CARD Act that is still being clarified, tweaked and amended because it was so poorly written.   
Well, even as the CFPB conducts its "inquiry" into Overdraft Protection (comment period extended to June 29th) - Congress is at it again.
Overdraft Protection Act.  Representative Carolyn Maloney (and 46 co-sponsors) announced she would introduce legislation that would:
  • Extend the opt-in requirement to paper checks, ACHs and recurring debit transactions;
  • Define overdraft fees as finance charges for Truth in Lending Act disclosures (Ed: Huh??);
  • Prohibit the ordering of transactions to maximize overdrafts;
  • Require that fees be "reasonable and proportional" to the amount of the overdraft;
  • Cap the number of fees at one per month and six per year;
  • Add new disclosures prior to opt-in and whenever an overdraft fee is charged; and
  • Require the CFPB to study overdraft fees on prepaid debit cards.
I guess when they say they want to "Stop Overdraft Protection" they are serious.  This bill (we haven't seen the full text yet) would pretty much do just that.  I can't imagine too many institutions continuing to provide this service if a bill along these lines would actually pass.
But, I wonder if Congress is worried that if they prohibited overdraft protection it would force consumers to actually keep track of their spending and take some responsibility.  Now, that would be draconian.
Consumer Groups.  If you haven't seen the recent Pew Study on Overdrafts, it is worth a read.  Also be sure to pass around your credit union.  This is what is being handed out to the CFPB and Congress in pushes to change the current overdraft rules.
***Overdraft Programs Under Attack; Recap of Reg Burden Hearing

    Comments

    Post a Comment

    Please no profanity or political comments.

    Popular posts from this blog

    Ramp Up Cyber Spending As AI Reshapes Industry Priorities

    NEW YORK—Artificial intelligence is rapidly becoming the defining force shaping banking strategy, with 80% of banking executives now expecting AI to significantly disrupt their business and operating models within the next three to five years, according to KPMG's 2026 Banking Technology Survey. The survey of 200 U.S. banking executives found institutions are responding by accelerating investments in cybersecurity, payments modernization and technology-driven acquisitions. "AI, payments modernization, cybersecurity, and tech-driven M&A are no longer separate agendas," said Peter Torrente, KPMG's U.S. Banking Sector Leader, who said banks are increasingly being challenged to keep pace across technology, risk and growth simultaneously. Cybersecurity remains a top concern. More than three-quarters (76%) of banking leaders reported an increase in cyberattacks over the past year, while 92% said they are boosting cybersecurity budgets. In addition, 84% are increasing cyb...
    Post a Comment
    Read Complete Article HERE>»

    White Paper from WOCCU Examines How Stablecoins are Reshaping Financial Infrastructure

    WASHINGTON– World Council of Credit Unions (WOCCU) has released a new white paper that examines how stablecoins are reshaping the financial infrastructure that credit unions and other cooperative financial institutions rely on to serve their members.  According to WOCCU, the white paper, How Digital Money Is Impacting Credit Unions, Part 1: Focus on Stablecoins , is the first in a planned three-part series exploring how emerging forms of digital money are affecting the global credit union movement.  “The report begins by noting that stablecoins are no longer a niche fintech development, but part of a broader structural shift in how money is stored, moved and regulated,” WOCCU explained. “As commercial banks, payment networks, technology firms and retailers build stablecoin offerings or integrate stablecoin rails into their platforms, credit unions must consider how these changes could affect deposits, payments, member relationships and long-term institutional relevance.” For ...
    Post a Comment
    Read Complete Article HERE>»

    Half of Credit Union & Bank CEOs are Now Older Than 65, Up From 20% Two Decades

    NEW YORK — At a time when there are some generational changes in credit union leadership taking place, a new analysis has found the nation’s bank CEOs are getting older, with half of the chief executives leading banks now older than 65, compared with fewer than 20% two decades ago. The KBW Bank Index from Truist Securities found that the median age of bank CEOs has increased by 10 years since the early 2000s, mirroring a broader aging trend among corporate leaders across the United States. However, bank executives remain older on average than their counterparts in many other industries, according to the analysis by Truist Securities Managing Director John McDonald and associates Peter Nicolo and John Manahan. One reason is tenure. Bank CEOs typically remain in their positions longer than executives in many other sectors. According to data from CristKolder Associates cited in the report, financial-services CEOs average nine years in the role, compared with 5.4 years in the energy secto...
    Post a Comment
    Read Complete Article HERE>»

    What Credit Unions Can—And Can't—Do With New Trump Accounts

    07/02/2026 09:36 am         WASHINGTON--With Trump Accounts set to officially launch July 4, America’s Credit Unions updated its frequently asked questions document to clarify the role of credit unions now and in the future. Credit unions do not have a role to play yet, as the Treasury has not announced steps to transition accounts from initial provider BNY Mellon to other authorized institutions, ACU noted. Trump Accounts are tax-deferred accounts that can be established on behalf of a child under the age of 18. Account contributions begin after July 4, with contributions up to $5,000 a year allowed. Created by H.R. 1, the law also established a pilot program to deposit a one-time $1,000 grant into accounts of children born between Jan. 1, 2025 and Dec. 31, 2028. Once the child turns 18, the account funds are available for educational expenses, home ownership, entrepreneurship, and other designated purposes. Once guidance is available from Treasury, credit unions ...
    Post a Comment
    Read Complete Article HERE>»

    Sunday Reading - We Hold These Truths to Be Self-Evident

    We Hold These Truths to Be Self-Evident .  The Declaration of Independence is the founding document that formally announced the American Colonies' break from British rule. Adopted on July 4, 1776, it laid the philosophical and moral foundation for American self-governance, asserting that individuals possess inherent rights and that governments must be accountable to the people. While it didn't create a government or legal framework, the Declaration marked the birth of the United States as a sovereign nation. >  Hear why the Continental Congress decided to declare independence, how the text took shape...
    Post a Comment
    Read Complete Article HERE>»

    NCUA Tells FICUs Crypto Trading is OK — If Big Exchanges Provide the Service

    When it comes to reading between the lines of financial regulators’ advisory letters, tone matters. Take last week’s letter from the National Credit Union Administration (NCUA) which gave the federally insured credit unions (FICUs) it oversees permission to partner with digital asset providers to allow retail customers to buy, sell and trade in cryptocurrencies. Now compare it to the one issued by Comptroller of the Currency Michael Hsu’s agency to the national banks and federal savings associations it regulates a month earlier. On the surface, both said much the same thing: Financial institutions can provide cryptocurrency services (albeit with some notable differences: the OCC’s letter dealt with more back-end services, including custody services as well as holding and using dollar-pegged stablecoins for transaction settlement). Neither was enthusiastic. The NCUA’s letter said it “does not prohibit FICUs from establishing these relationships” — which is not as enthusiastic as “are a...
    Post a Comment
    Read Complete Article HERE>»

    Twenty-Five Years of Showing Up

    www.NCOFCU.org/Tucson-AZ-2026    Attendee Registration Schedule at a Glance ...
    Post a Comment
    Read Complete Article HERE>»

    Emerging Risks and How to Mitigate Them

    5 Emerging Risks and How to Mitigate Them With each technological advance emerges new risk. Think about it: Every technology upgrade, new mobile device and new payment method brings exposure that wasn’t identified previously. The real threat occurs when these risks aren’t anticipated or communicated within your organization. Here are five emerging risks every credit union should have on their radar right now: Social media. Employees posting comments on social media that are inaccurate or appear incomplete or disparaging can threaten your organization’s reputation. Be careful when taking disciplinary action, as the National Labor Relations Board can classify social media activity as “protected concerted activity.” Mistakes here can lead to retaliation, wrongful termination claims and expensive litigation. Internet of Things (IoT) era . The IoT offers new tools and technologies that provide constant connectivity. It also creates new opportunities for data compromises. Workplace ...
    Post a Comment
    Read Complete Article HERE>»

    What You Might Not Know About July 4th.

    Post a Comment
    Read Complete Article HERE>»

    Houston Texas Fire Fighters Federal Credit Union Disaster Relief Fund

    Houston Texas Fire Fighters Federal  Credit Union Disaster Relief Fund   The National Council of Firefighter Credit Unions Inc (NCOFCU) has established a Disaster Relief Fund which will contribute directly to the Houston Texas Fire Fighters Federal Credit Union. The fund's donations will be used to assist in the rebuilding efforts of their staff and volunteers. Many of the staff and volunteers have suffered sufficient losses if not total losses to their homes and property due to the heavy rains and flooding in the past week. If you or your credit union/organization would like to contribute directly to Houston Texas Fire Fighters Federal  Credit Union through our fund to further assist in their recovery, please use the following links. Ways to Give     Mail in Pledge Form      On-Line Contribution Form *The National Council of Firefighter Credit Unions, Inc. (NCOFCU) is a non-profit, 501(c) (3) charitable organization. Donors ...
    Post a Comment
    Read Complete Article HERE>»